Investigation and settlement
Under which circumstances would the company and officers or employees need separate legal representation? Do the authorities require separate legal representation during certain types of investigations?
The Finnish competition regime does not require undertakings (nor any officers or employees of undertakings) to have separate legal representation during Finnish Competition and Consumer Authority (FCCA) investigations. However, it is common practice for an undertaking to appoint outside counsels from the beginning of the authority’s investigations.
Under the Administrative Procedure Act (434/2003), which applies to FCCA investigations, an undertaking is entitled to retain an attorney or a counsel for an administrative matter. However, an undertaking’s representatives must appear in person if a matter requires clarification.
It is highly recommended for an undertaking under investigation by competition authorities to use outside counsel in connection with investigations.
For what types of infringement would the regulatory authority launch a dawn raid? Are there any specific procedural rules for dawn raids?
Dawn raids are a frequently used method of investigation in Finland and mostly relate to cartel investigations. However, dawn raids may also relate to other suspected competition restriction covered by the Competition Act and merger control matters. The FCCA has established procedures regarding dawn raids.
At the beginning of an inspection, the FCCA notifies the undertaking of its inspection decision. The suspected restriction of competition investigated by the FCCA is stated in the inspection decision, as well as the provisions of law applicable to rights of inspection. Customarily, the investigation starts with a discussion with the undertaking’s representatives, during which the undertaking is also informed of the related rights and responsibilities. However, a discussion is not a prerequisite for initiating an inspection.
After informing the undertaking of the inspection decision, the FCCA’s representatives may enter the premises which they consider to be of relevance to the inspection. The FCCA may (but is not obliged to) wait for the arrival of an external adviser of the company for a reasonable time before beginning to investigate the company’s documents and data or interviewing its representatives.
During the inspection, the FCCA examines business documents and paper-based and electronic data and makes copies. Usually, officers’ and employees’ computers are searched and copied, including any electronic correspondence. Therefore, extensive electronic material is reviewed during an inspection.
What are the company’s rights and obligations during a dawn raid?
In addition to the Competition Act, the rights and responsibilities of the FCCA and the company are based on the Administrative Procedure Act.
Under the Competition Act, an undertaking must allow FCCA inspectors to enter its premises and access its business data and documents.
An inspected undertaking must cooperate in carrying out the inspection by providing FCCA with all of the documents and information relating to the matter under investigation.
Representatives of an undertaking have the right to be present during the inspections. An inspected undertaking cannot be forced to admit that it has committed any competition infringement. However, its representatives must answer factual questions and deliver documents even if such information could be used against it.
Is there any mechanism to settle, or to make commitments to regulators, during an investigation?
The FCCA may confirm that the commitments submitted by an undertaking or undertakings involved in a suspected infringement will be binding on them, provided that the restrictive nature of the conduct can be eliminated by the actions defined in the commitments. However, the FCCA may re-initiate proceedings if:
- any fact on which the decision is based has significantly changed;
- the undertakings concerned infringe their commitments; or
- the decision has been based on insufficient, false or misleading information submitted by the parties involved.
What weight will the authorities place on companies implementing or amending a compliance programme in settlement negotiations?
The focus of the commitments submitted by undertakings involved in a suspected infringement is on cessation of the suspected competition infringement.
Are corporate monitorships used in your jurisdiction?
Corporate monitorships are not used in Finland.
Statements of facts
Are agreed statements of facts in a settlement with the authorities automatically admissible as evidence in actions for private damages, including class-actions or representative claims?
The information and evidence submitted to the FCCA and information included in the leniency statement for obtaining immunity or a reduced fine may not be used for any other purpose than:
- an order to terminate a restraint on competition;
- an order to deliver a product;
- a commitment decision;
- a withdrawal of a block exemption; or
- a review of a penalty payment proposed by the FCCA, Market Court or Supreme Administrative Court.
This information may also be used in court proceedings relating to damages caused by competition restriction (private enforcement of competition regulation).
Invoking legal privilege
Can the company or an individual invoke legal privilege or privilege against self-incrimination in an investigation?
Legal privilege is applicable to FCCA investigations.
No specific application is needed in order to benefit from legal privilege. Authorities must comply with the protection of legal professional privilege (LPP) material and not include LPP material in an investigation.
An undertaking need not deliver to the FCCA documents which contain LPP material.
Therefore, FCCA inspections do not target confidential correspondence between companies and their external legal advisers which is exchanged for the purpose of defending the company in relation to an alleged restriction of competition. The FCCA also takes into account the guidelines set by the decisional practice of EU courts concerning the protection of material within the scope of LPP.
In practice, during an inspection the FCCA aims to identify and separate LPP material from other documents and data. An undertaking may be asked to state the name of its external legal adviser or the law firm used. Further, an undertaking may be asked to state which representatives or employees are likely to possess LPP material.
In practice, the FCCA may ensure that the document is within the scope of LPP material by way of a cursory examination. A document will not be handled as LPP material based on only the name or email address of an adviser or the subject. During an investigation, the FCCA may exclude a document from the material, set it temporarily aside or place it under seal and later assess whether the document falls within LPP material later during the investigation.
What confidentiality protection is afforded to the company and/or individual involved in competition investigations?
Under Section 24 of the Act on Openness of Government Activities (621/1999), documents containing information regarding a private business or professional secret, as well as documents containing other comparable private business information, must be kept secret. In addition, FCCA investigations must consider privacy protection. For example, during a dawn raid, protected materials include emails relating to a person’s private life. In practice, the FCCA has the right to confirm whether such material falls within the scope of its inspections, but the FCCA and individual inspectors must refrain from inspecting documents and data found to be private in any more detail. Further, the FCCA and inspectors are bound by the obligation of confidentiality concerning the contents of private documents and data.
Refusal to cooperate
What are the penalties for refusing to cooperate with the authorities in an investigation?
The FCCA may impose a periodic penalty payment to enforce the condition set or the order, prohibition or obligation issued based on the Competition Act. Periodic penalty payments are ordered by the Market Court and may not be imposed on a natural person to fulfil their obligation to deliver information when the person has been invited to appear before the FCCA in connection with an investigation.
The Act on Conditional Fines (1113/1990) provides for the imposition and ruling of a conditional fine.
During an inspection, the following practices are punishable under the Competition Act or the Criminal Code:
- providing false evidence (eg, false, legally relevant oral information to an authority);
- preventing an official act or making such an act more difficult to carry out; and
- breaking a seal without FCCA permission.
Is there a duty to notify the regulator of competition infringements?
There is no duty to notify the regulator of competition infringements in Finland.
What are the limitation periods for competition infringements?
Unless the proposal to the Market Court has been filed within five years of the date of the violation or, in the case of a continuous infringement, within five years of the date on which the violation ended, penalty payments will not be imposed for:
- a violation of the obligations regarding prohibited restraints on competition between undertakings;
- an abuse of dominant position;
- a violation of the obligations regarding prohibiting a concentration and imposing conditions upon a concentration or implementation of a concentration; or
- a violation of Articles 101 or 102 of the Treaty on the Functioning of the European Union.
The FCCA’s measures to investigate an infringement will reset the limitation period. However, a penalty payment will not be imposed if the FCCA’s proposal to the Market Court has not been made within 10 years of the date of the violation or, in the case of a continuous infringement, within 10 years of the date on which the violation ended.